Gojek-Grab Overtaking One Another for Southeast Asian Financial Market

Writer: Desy Setyowati

Editor: Muchamad Nafi

29/7/2019, 12.25 WIB

Gojek and Grab are racing in the service business. After becoming superapps, the two companies target financial market in Southeast Asia.

Ilustrasi digital
Gojek-Grab Overtaking One Another for Southeast Asian Financial Market

“Now is the time for the evolution of Go-Pay and financial services.”

This statement came from Gojek CEO Nadiem Makarim when announcing the company’s new logo. On Monday (7/22), PT Aplikasi Karya Anak Bangsa officially changed its logo from the image of motorcycle taxi driver with wifi symbol atop to a dot encircled by a nearly rounded ring.

For Nadiem, the move is not just a matter of replacing the Gojek logo. It is a marker of evolution from an online motorcycle taxi service provider to superapp. One of the services to be improved is financial services. Gojek does intend to increase financial inclusion in Southeast Asia, a step that its competitor Grab also took.

Looking back to almost two years ago, Gojek focused on developing Go-Pay. This can be seen from the acquisition of three local financial technology service startups at the end of 2017. They were Kartuku, Midtrans, and Mapan.

He then appointed Mapan’s founder Aldi Haryopratomo as CEO of Go-Pay. Aldi and Nadiem are both graduates of Harvard University. “We have the same mission, building Indonesia from the bottom,” Aldi said in a special interview with Katadata.co.id, earlier this year.

He has a long experience in developing micro-finance business. In 2009, Aldi established a startup called RUMA (Rekan Usaha Mikro Anda) to reach small traders who sell electricity vouchers, cell phones, and credit instalment services. He also founded Arisan Mapan, which has more than 2.3 million users.

The Indonesian E-commerce Association (IDEA) Chairman Ignatius Untung said on-demand service companies, such as Gojek and Grab, currently have a high chance of dominating financial market in Indonesia. One of the requirements has been fulfilled. These two decacorns have numerous partners throughout the archipelago.

Moreover, Gojek and Grab also provide a variety of daily services such as transportation or ride-hailing, food order, payment of bills, and others. “Financial services will not be used if we do not know where to use them. It would be good if it could be used routinely,” he told Katadata, Tuesday (7/23).

The financial sector is a potential market as there are still many Indonesians who have not gained access to banking (unbanked) or other financial services (see Databoks below). Gojek and Grab can work on this market to make a profit.

Moreover, the two startups with a valuation of more than US$ 10 billion have expanded the market through a variety of services. Online motorcycle taxis can be a stepping stone to get consumers. Thus, it will be easier for Gojek and Grab to provide financial services.

The Fintech Indonesia Association (Aftech) positively welcomed the participation of Gojek and Grab in working on the financial market. “The presence of technology will benefit the public because of more varied products. But the most important thing is that they always adhere to regulations and prioritize consumer protection,” Aftech Director Tassa Nugraza Barley said.

Gojek's Strategy to Win the Financial Market

In Indonesia, Gojek has Go-Pay. This financial technology company (fintech) has attracted more than 400 thousand Go-Food partners and 60 thousand service providers through the Gojek platform.

Go-Pay serves a variety of payments ranging from e-commerce, vouchers, payment of bills, insurance to donations. Go-Pay users reach 155 million, or according to the number of downloads on the Gojek app. Until now, Gojek has no plans to separate Go-Pay from its platform.

Nadiem recently said the Gross Transaction Value (GTV) on its platform was US$ 9 billion or around Rp 126 trillion in 2018. It rose 13.5 times compared to 2016.

According to Go-Pay Head of Corporate Communications Winny Triswandhani, about half of the transactions on the Gojek platform used payment services from Go-Pay. Transactions outside the Gojek app service also grew 25 times throughout the past year.

Go-Pay also works with more than 300 foundations and mosques to provide digital donation services. “Donations through Go-Pay rose 400 times from July 2018 to June 2019,” Winny said.

Gojek also teamed up with PasarPolis, an insurance technology (insurtech) company. They released Go-Sure, which is still in beta version and only offers travel insurance products to users.

In 2017, the two companies also launched an insurance service for driver partners named Go-Proteksi. Last August, PasarPolis received series A round from Gojek, Traveloka and Tokopedia.

Persaingan gojek-grab
The competition between Gojek and Grab is increasingly fierce. The Southeast Asian financial market is a new battlefield. (Katadata)

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